Glencore delays start of operations at Tuxpan port fuel terminal by more than a year to Q3 2020
The start of operations at Glencore’s planned 1.5 million barrel fuel terminal at the Mexican port of Tuxpan in Veracruz state has been delayed by in excess of a year, the Swiss commodities giant said in a statement.
The terminal was initially expected to begin commercial operations in the first half of 2019, but is now expected to commence operations in the third quarter of 2020 after construction starts in the second quarter of next year, Glencore said.
The terminal would be built at a strategic location in the Gulf of Mexico that would allow Glencore to directly supply the greater Mexico City metropolitan area, the country’s largest market.
Currently, there is a race underway to supply Mexico’s central region, where, in addition to Glencore, companies such as Valero, ExxonMobil, Total, BP, Shell and Repsol are looking to gain a share of the market.
The central region includes Mexico City and the states of Mexico, Hidalgo, Puebla, Queretaro, Guanajuato, Morelos and Tlaxcala. This area represented 34% of all the gasoline and 25% of the diesel consumed in the country in 2017, data from Mexico’s Energy Secretariat (SENER) show.
Glencore did not respond to a request for comment Tuesday on why the project is facing delays.
However, multiple developers told S&P Global Platts permitting issues are delaying the construction of terminals in Mexico.
According to SENER’s terminal project database, the regulatory permitting process for Glencore’s Tuxpan project is ongoing.
Tuxpan is one of two marine terminals Glencore is involved with in Mexico. In August, the company began operating a 600,000-barrel terminal at the southern Mexican port of Dos Bocas in the state of Tabasco.
In 2017, the company positioned itself as the largest private fuel retailer in Mexico after partnering with retail group Grupo 500 to launch the G500 Network brand.
The consortium has over 1,400 forecourts in Mexico, over 10% of the country’s total. About 400 of this filling station total are located in the greater Mexico City region.
G500 Network stations sold over 160,000 b/d of gasoline and diesel in 2017, the joint venture said previously.
The franchise represented 13.8% of Mexico’s total gasoline and diesel sales in 2017, according to SENER data